Finding Text
2023-002 – Special Test and Provision – Annual Report Card, High School Graduation Rate –
Material Weakness in Internal Control over Compliance/Material Noncompliance
ALN and Title: 84.010 Title I Grants to Local Educational Agencies
Pass-Through Entity: NM Public Education Department
Identifying Number: 24101
Award Year: 2022-23 School Year
Condition: The District was not obtaining proper written documentation to substantiate the correct
student withdrawal codes for 33 of 40 students tested. The withdrawal form did not have the
signature of the school official and contained a different withdrawal code on the withdrawal form
than the sample listed in 6 of 40 students tested.
Criteria: Per Title 2 US Code of Federal Regulations Part 200.303a, the non-federal entity must
establish and maintain effective internal control over the Federal award that provides reasonable
assurance that the non-Federal entity is managing the Federal award in compliance with Federal
statutes, regulations, and the terms and conditions of the Federal award. These internal controls
should be in compliance with guidance in “Standards for Internal Control in the Federal
Government” issued by the Comptroller General of the United States or the “Internal Control
Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway
Commission (COSO).
Per the May 2023 Compliance Supplement, to remove a student from the cohort, a school or LEA
must confirm, in writing, that the student transferred out, emigrated to another country,
transferred to a prison or juvenile facility, or is deceased. To confirm that a student transferred out,
the school or LEA must have official written documentation that the student enrolled in another
school or in an educational program that culminates in the award of a regular high school diploma.
A student who is retained in grade, enrolls in a GED program, or leaves school for any other reason
may not be counted as having transferred out for the purpose of calculating graduation rate and
must remain in the adjusted cohort (ESEA sections 1111(h)(1)(C)(iii)(II) and 8101(23), (25) (20 USC
6311(h)(1)(C)(iii)(II) and 7801(23), (25))).
Per Farmington Municipal School District Board Policy, Section J Students, J-1300 Student
Withdrawal from School, a withdrawal form shall be presented to the parent or legal guardian of a
student who may or must withdraw from school. The withdrawal form shall include space for the
reason for withdrawal and the signature of an official of the school from which the student has
withdrawn. Questioned Costs: None noted.
Effect: District’s reported High School Graduation Rate for the 2022-2023 school year cannot be
verified due to lack of written documentation for students removed from cohort.
Cause: A deficiency in the internal control system to properly train and monitor the personnel who
are assigned to maintain the accuracy of student records and ensure the District obtain all the
necessary written documentation for student’s files.